Post office savings under lens? Why PAN is now mandatory under 2026 tax rules

India’s vast post office savings network is coming under tighter tax scrutiny as the government introduces stricter compliance norms under the Income-tax Rules, 2026. In a major change for depositors, quoting Permanent Account Number (PAN) has now become mandatory for several post office financial transactions, including account openings, deposits, withdrawals and investments in savings schemes.

The move is part of the government’s broader push to improve financial transparency, strengthen audit trails and bring traditional small savings channels more firmly into the formal tax reporting system.
The revised rules are expected to impact millions of depositors who use post office-backed savings products such as National Savings Certificates (NSC), Senior Citizen Savings Scheme (SCSS), Monthly Income Scheme (MIS), recurring deposits and Post Office Time Deposits.

PAN now mandatory

Under the updated framework, depositors will have to quote PAN while carrying out specified financial transactions at post offices. The requirement falls under Rules 159, 160, 161, 211 and 237 of the Income-tax Rules, 2026. 
The Department of Posts, through Post Office SB Order No. 02/2026, has directed that PAN must be quoted for all notified transactions. 

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This marks a significant shift for the post office ecosystem, which has traditionally seen high participation from small savers, pensioners and individuals in semi-urban and rural areas who often relied on paper-based documentation and cash transactions.

Tax experts say the tighter rules are aimed at improving traceability of financial flows and reducing the scope for unreported or anonymous transactions.

In case of no PAN

The government has also introduced a formal alternative mechanism for individuals who do not possess a PAN card. Instead of the earlier Form 60, depositors without PAN will now have to furnish Form 97. 

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The new form requires detailed disclosures, including:

• Name and address of the depositor
• Nature of the transaction
• Transaction amount
• Supporting identity and address documents

This means even non-PAN transactions will now leave a documented compliance trail within the tax system.

Financial experts believe this is part of a larger effort to align post office savings operations with banking-sector reporting standards.

Forms 15G And 15H Replaced

Another major procedural change under the new rules is the replacement of Forms 15G and 15H with a consolidated Form 121. 

Earlier, Forms 15G and 15H were submitted by eligible taxpayers seeking exemption from Tax Deducted at Source (TDS) on interest income if their estimated annual tax liability was nil.

While Form 15G was used by individuals below 60 years of age, Form 15H was meant for senior citizens.

Now, both declarations have been merged into a single standardised form applicable across categories.

Compliance, record-keeping rules

The updated framework also places greater responsibility on post offices for verification and record maintenance.

Under the revised process:

• Form 121 must be submitted separately for every financial year
• Post offices will verify declarations internally
• Records and supporting documents must be preserved for seven years
•  

The government has clarified that until technology systems are fully upgraded, the existing operational process for Forms 15G and 15H will continue temporarily. 

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Why the move matters

The latest changes indicate that small savings channels are increasingly becoming part of India’s broader digital and tax compliance infrastructure.

By making PAN mandatory and standardising declaration forms, the government aims to improve monitoring of financial transactions, strengthen transparency and streamline reporting across savings products.

For depositors, the takeaway is straightforward: ensure PAN details are updated for all post office investments and transactions. Those without PAN should be prepared for additional disclosure requirements under Form 97 as compliance norms tighten across the financial system.

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